Youzan Technology Limited — Capital/Financing Update 2018

Jun 1, 2018

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

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China Innovationpay Group Limited 中國創新支付集團有限公司

(Incorporated in Bermuda with limited liability)

(Stock Code: 8083)

ADOPTION OF SHARE AWARD SCHEME

On 31 May 2018 (after trading hours), the Board approved the adoption of the Scheme with immediate effect, pursuant to which all Eligible Persons will be entitled to participate. The purpose of the Scheme is to recognise the contributions by certain Eligible Persons and provide them with incentives in order to retain them for the continuing operation and development of the Group, and to attract suitable personnel for further development of the Group.

A summary of the principal terms of the Scheme is set out below.

PURPOSE

The purposes and objectives of the Scheme are to provide incentives and reward the contributions of certain Eligible Persons and provide them with incentives in order to retain them for the continuing operation and development of the Group, and to attract suitable personnel for further development of the Group.

DURATION AND ADMINISTRATION

Unless terminated earlier by the Board in accordance with the Scheme Rules, the Scheme is valid and effective for a term of 10 years commencing on the Adoption Date provided that no transfer of funds or the allotment and issue of new shares to the Trust will be made by the Company on or after the 10th anniversary date of the Adoption Date.

PARTICIPANTS

Participants under the Scheme can be any Eligible Person.

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ADMINISTRATION

The Scheme is subject to the administration of the Board and the Trustee in accordance with the Scheme Rules and the terms of the Trust Deed.

OPERATION

Subject to the relevant Scheme rules, (1) the Company can issue and allot Shares to the Trustee from time to time under general mandates granted or to be granted by the Shareholders at general meetings of the Company from time to time (unless such issue and allotment of Shares has otherwise been approved by the Shareholders) for future awards; or (2) in case where the Board have selected certain Eligible Person to be Selected Participant(s), the Company shall, as soon as reasonably practicable after the Grant Date, for the purposes of satisfying the grant of awards, issue and allot Shares to the Trustee under general mandates granted or to be granted by the Shareholders at general meetings of the Company from time to time (unless such issue and allotment of Shares has otherwise been approved by the Shareholders) and/ or transfer to the Trust the necessary funds and instruct the Trustee to either (i) subscribe Shares to be issued by the Company or (ii) acquire Shares through on-market transactions at the prevailing market price. The Trustee must hold the Shares until they are vested in accordance with the Scheme Rules. When the Selected Participant has satisfied all vesting conditions specified by the Board at the time of making the award and become entitled to the Shares forming the subject of the award, the Trustee will transfer the relevant vested Shares to the Selected Participant.

VOTING RIGHTS

The Trustee shall not exercise any voting rights and powers in respect of any Shares held under the Trust (including, but not limited to, the Awarded Shares, the Returned Shares, any bonus Shares and scrip Shares).

BLACK-OUT PERIOD

No award of Shares shall be made to the Selected Participants who are Directors (“ Award to Director(s) ”) and no instructions to acquire Shares shall be given to the Trustee with respect to an Award to Director(s) under the Scheme (i) where any Director is in possession of unpublished inside information in relation to the Company or its securities where dealings in any of the Company’s securities by Directors are prohibited under any code or requirement of the GEM Listing Rules and all applicable laws from time to time; (ii) during the period of 60 days immediately preceding the deadline for the Company to publish its annual results announcement under the GEM Listing Rules; and (iii) during the period of 30 days immediately preceding the deadline for the Company to publish its quarterly or interim results announcement under the GEM Listing Rules, and ending on the date of the relevant results announcement.

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VESTING AND LAPSE

Subject to terms and conditions of the Scheme and the fulfilment of all vesting conditions to the vesting of the Awarded Shares on such Selected Participant, the Awarded Shares held by the Trustee on behalf of the Selected Participant shall vest in such Selected Participant.

Unless the Board or its delegate(s) determines otherwise at their absolute discretion or save for a Selected Participant who ceases to be an Eligible Person by reason of retirement of the Selected Participant, if a Selected Participant ceases to be an Eligible Person by reason of (i) death of the Selected Participant, (ii) termination of the Selected Participant’s employment or contractual engagement with the Group or an affiliate by reason of his/her permanent physical or mental disablement, (iii) termination of the Selected Participant’s employment or contractual engagement with the Group by reason of redundancy, any outstanding Award Shares not yet vested shall be immediately forfeited.

SCHEME LIMIT

The Board must not make any further award of unvested Shares which would result in the number of Shares awarded by the Board under the Scheme representing 10% or more of the issued Shares of the Company from time to time without Shareholders’ approval.

The maximum number of Shares which may be subject to an award or awards to a Selected Participant in any 12-month period shall not in aggregate exceed 1% of the issued Shares of the Company from time to time.

GENERAL MANDATE MAY BE USED TO SATISFY SHARE AWARDS

If share awards are to be comprised of new Shares, such new Shares shall be allotted and issued by the Board to the Trustee on behalf of the Eligible Persons using the general mandate granted to them by the shareholders of the Company from time to time unless separate shareholders’ approval is obtained in a general meeting of the Company. The Company will comply with the relevant GEM Listing Rules when granting awards of new Shares or issuing new Shares to satisfy awards.

SHARE AWARDS TO DIRECTORS AND/OR CONNECTED PERSONS

Shares may be awarded to Eligible Persons, including Directors and/or connected persons of the Group. If new Shares are awarded to Directors and/or connected persons of the Group, such awards shall constitute connected transactions under Chapter 20 of the GEM Listing Rules and the Company shall comply with the relevant requirements under the GEM Listing Rules.

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Each grant of a share award to any Director shall be subject to the prior approval of all the members of the remuneration committee of the Company, or in the case where the grant of a share award is proposed to be made to any member of the remuneration committee, by all of the other members of the remuneration committee.

ALTERATION

The Scheme may be altered in any respect by a resolution of the Board provided that no such alteration shall operate to affect adversely any subsisting rights of any Selected Participants except with (i) the consent in writing of Selected Participants amounting to three-fourths of the total voting rights attached to all Shares so held by the Trustee on that date; or (ii) the sanction of a special resolution passed at a meeting of the Selected Participants.

TERMINATION

The Scheme shall terminate on the earlier of the 10th anniversary of the Adoption Date or such date of early termination as determined by the Board provided that such termination does not affect any subsisting rights of any Selected Participants.

Upon termination, unless otherwise separate arrangements have been mutually agreed by and between the Board and the Trustee in the best interest of the Selected Participants and the operation of the Scheme, (i) all the Awarded Shares shall become vested in the Selected Participants so referable on such date of termination, subject to the receipt by the Trustee of the transfer documents (where applicable) duly executed by the Selected Participant within the stipulated period or the receipt of relevant funds by the Trustee for on-market purchase of sufficient Shares to satisfy the requisite vesting; (ii) the Returned Shares and any non-cash income remaining in the Trust fund shall be sold by the Trustee within 20 trading days of the Stock Exchange (on which the trading of Shares has not been suspended); and (iii) residual cash, net proceeds of sale referred to above and such other funds remaining in the Trust shall be remitted to the Company after the sale.

THE GEM LISTING RULES IMPLICATIONS AND OTHER INFORMATION

The Scheme is a discretionary scheme of the Company, which does not constitute a share option scheme or an arrangement analogous to a share option scheme for the purpose of Chapter 23 of the GEM Listing Rules. Accordingly, no shareholders’ approval is required for the adoption of the Scheme by the Board.

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DEFINITIONS

In this announcement, unless the context requires otherwise, the following expressions shall have the following meanings:

“Adoption Date”	31 May 2018;
“Awarded Shares”	the Shares awarded to a Selected Participant in accordance with the
	terms of the Scheme Rules;
“Board”	the board of Directors;
“Business Day”	any day on which the Stock Exchange is open for the business of
	dealing in securities;
“Company”	China Innovationpay Group Limited, a company incorporated in
	Bermuda with limited liability, the issued Shares of which are listed on
	GEM;
“connected person”	has the meaning as defined in the GEM Listing Rules;
“Director(s)”	the director(s) of the Company;
“Eligible Person(s)”	any individual, being an Employee, Director (including, without
	limitation, any executive, non-executive or independent non-executive
	Director), officer, consultant or adviser of any member of the Group or
	any other person whom the Board or its delegate(s) considers, in their
	sole discretion, to have contributed or will contribute to the Group;
“Employee”	any employee (whether full time or part time) of any member of the
	Group;
“GEM”	GEM operated by the Stock Exchange;
“GEM Listing Rules”	the Rules Governing the Listing of Securities on GEM;
“Grant Date”	the date on which the grant of an award is made to a Selected
	Participant;

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“Group”	the Company and its Subsidiaries;
“Hong Kong”	the Hong Kong Special Administrative Region of the People’s Republic
	of China;
“inside information”	has the meaning as defined in the Securities and Futures Ordinance
	(Chapter 571 of the laws of Hong Kong);
“on-market”	the acquisition of Shares of the Company through one or more
	transactions through the facilities of the Stock Exchange in accordance
	with the GEM Listing Rules and any other applicable laws and
	regulations;
“Returned Shares”	such Awarded Shares and related income which are not vested and/or
	forfeited in accordance with the terms of the Scheme Rules;
“Scheme”	the share award scheme approved by the Board on 31 May 2018 (after
	trading hours), as amended from time to time in accordance with the
	provisions thereof;
“Scheme Rules”	the rules relating to the Scheme adopted by the Board;
“Selected Participant(s)”	Eligible Person(s) selected by the Board for participation in the
	Scheme;
“Share(s)”	share(s) of HK$0.01 each in the share capital of the Company;
“Shareholder(s)”	holder(s) of the Share(s);
“Stock Exchange”	The Stock Exchange of Hong Kong Limited;
“Subsidiary”	a company which is for the time being and from time to time a
	subsidiary (within the meaning of the Companies Ordinance (Cap. 622
	of the Laws of Hong Kong)) of the Company, whether incorporated in
	Hong Kong or elsewhere;
“Trust”	the trust constituted by the Trust Deed;

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“Trust Deed”

a trust deed to be entered into between the Company and the Trustee (as restated, supplemented and amended from time to time);

“Trustee”

a trustee to be appointed by the Company for the purpose of the Scheme, which will hold Shares for the benefit of the Selected Participants and others subject to the terms and conditions of the Trust Deed;

“%”

per cent.

By Order of the Board China Innovationpay Group Limited Guan Guisen

Chairman

Hong Kong, 31 May 2018

As at the date of this announcement, the Board comprises seven executive Directors, Mr. Guan Guisen, Mr. Cao Chunmeng, Mr. Yan Xiaotian, Mr. Zhu Ning, Mr. Cui Yusong, Mr. Yu Tao and Ms. Ying Hangyan; and four independent non-executive Directors, Dr. Fong Chi Wah, Mr. Gu Jiawang, Mr. Xu Yanqing and Mr. Deng Tao.

This announcement, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the GEM Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this announcement is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this announcement misleading.

This announcement will remain on the “Latest Company Announcements” page of the GEM website for at least 7 days from the date of its posting and on the Company’s website at www.innovationpay.com.hk.

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